"Wait, do I have to disclose that?!?!"
Updated: Oct 28, 2019
Properties have skeletons in the closet, and sellers need to tell buyers ALMOST everything about them - it’s the law.
Full Disclosure is the law, and it’s also the title of my blog. As an agent, transparency and honesty in transactions is my number one priority. When it comes to disclosure, the rules are simple: if the seller knows about it, it must be disclosed! If the listing agent knows about it, it must be disclosed! As my principal broker and mentor, Amy Munsey, will tell you: disclose, disclose, disclose!
But do sellers actually have to disclose everything? Un-permitted construction and the odd leak in the basement may be obvious subjects for disclosure. But since it’s almost Halloween, what about spookier subjects? For example, do sellers have to disclose past deaths on a property? Well... I'm afraid Oregon does not consider past deaths - even suicides or homicides - “material” facts, and therefore they do not need to be disclosed. However, the expectation is that sellers AND agents will disclose all known things that go bump in the night - supernatural or not. By the way, there are places where buyers can go online to find out about these kinds of skeletons-in-the-closet, but it is up to them to do so, such as the Portland Police Bureau and Portland Maps websites.
So what needs to be disclosed in Oregon? To make it easier for everyone (including the ghosts) sellers must fill out a Seller’s Property Disclosure Statement. It includes fun things like title to the property (does the seller have a legal right to sell this house?), existing encumbrances (such as easements and liens), whether the property uses public water and /or sewer systems, known roof leaks, additions done without permits, zoning overlays that may affect the property, known hazardous construction materials, among others. Once an offer is accepted, this form needs to be provided to the buyer. But what about the real estate agents? It is a real estate agent's FIDUCIARY duty to FULLY DISCLOSE all material facts and hazards. Full disclosure will include any information that could affect a party's decision to enter a deal. Agents know that failure to do this may result in a failed transaction, or even worse, litigation.
HOWEVER, the single most important thing to understand when buying real estate is that neither the seller nor the agents are experts when it comes to material defects and/or hazards and therefore, for everyone's protection, even the ghost's, the buyers need to hire a professional for a home inspection. Reviewing the Sellers Property Disclosure Statement is not a substitute for a professional home inspection!
So let's review. Remember that every property has a history. Yes, there may be ghosts in the basement. If you are an agent or seller, when in doubt, disclose! Finally, make sure you do your due diligence, and hire that professional home inspector!
Happy House Haunting!